The winter holidays may look a little less merry and bright this year. As the weather cools, households across the U.S. are continuing to feel the heat of inflation.
Everything, including holiday activities, is more expensive this year. Airfare during Christmas and Hanukkah is up nearly 40% from last year. Electronics and toys gifts are 11% pricier. What’s supposed to be a jolly time of giving gifts and decking the halls has countless Americans second-guessing whether they can afford toys for their children or a plane ticket to their parents’ home.
But how exactly is everyone responding to the sticker shock? We surveyed 1,000 American adults to see how high inflation impacts holiday spending plans. We found that while a vast majority of Americans plan to cut back on holiday expenses, many are turning to side gigs to soften inflation’s strain.
- 42% of Americans who plan to cut spending for the holidays will buy fewer presents.
- 31% say they’ll spend less on travel.
- Despite inflation, 48% of Americans plan to absorb the increased prices and will spend more on holiday expenses (gifts, travel, etc…) in 2022 compared to 2021, with 13% anticipating spending $1,000 or more.
- Only 46% of Americans received a pay raise in the last year.
- 68% of Americans either have or plan to have a side gig to earn extra income.
- 82% of Americans who said they either have or plan to start a side gig, seasonal job, or work overtime said inflation pushed them to seek the extra income.
- 92% of Americans who have or plan to acquire a side gig or some other version of extra work plan to keep it after the holidays.
4 out of 5 Americans will make cutbacks on holiday spending
The vast majority of Americans plan to make financial sacrifices this holiday season. While some plan to buy fewer gifts, others will cut back on travel, decorations, parties, and charitable donations.
Inflation is also causing consumers to cut gift recipients from Santa’s nice list this year. According to a separate CouponFollow survey, 48% of Americans are forgoing presents for their friends. Many romantic partners (46%) and mothers (44%) will also leave this year’s holidays giftless. And only 5% of Americans said they anticipate making no cuts to their gift list.
Nearly half of Americans anticipate spending more money on the holidays this year
While high inflation is causing many Americans to cut back on holiday expenses, others are bracing to spend more this season than they did last year.
A majority of Americans are planning to spend the same or less than last holiday season’s expenses. But 13% are prepared to cushion inflation’s blow on the holiday spirit by spending an additional $1,000-plus compared to last year.
Less than half of Americans have received a pay raise in the past year
Even though many Americans are anticipating spending more money on the holidays this year, wages haven’t always caught up to how much more expensive inflation has made gifts, groceries, and travel.
Less than half of Americans have received a pay raise in the last year, despite inflation stubbornly remaining above 8%. Wages and salaries, by contrast, only increased 5.1% in 2022. So even the 46% of Americans who received a pay bump likely didn’t keep pace with inflation.
Our survey also indicates that 16% of Americans haven’t received in the past two years, which is well before inflation became so rampant.
2 in 3 Americans are either working or plan to work a side gig
So how are Americans preparing to afford such a pricey holiday season? The popular option: gig work. As it turns out, 68% of American adults either already have or plan to pick up a side gig, like delivering food with DoorDash or renting out extra space with Neighbor.com.
Additionally, 44% of Americans currently work or plan to work a seasonal job, like shipping packages for Amazon or stocking and unloading for Walmart. And 51% either currently work or plan to work overtime at their current 9-5 job.
Americans across the country are picking up side hustles to offset the cost of inflation. Two out of every five work a side gig, with an additional 30% planning to take one up in the near future.
Inflation pushed Americans to seek extra work
The proliferation of side gigs is no coincidence. More than 4 out of 5 Americans who currently have or plan to take on a side gig, seasonal job, or extra hours at work say inflation played a role in their decision.
And most Americans with side hustles seem committed to gig work for the long haul. While it may start as a hedge against pricier gifts and steep travel prices, more than 9 in 10 Americans who either have or plan to have a side gig are prepared to continue it after the holiday season.
And which side gigs are Americans taking up? There’s no shortage of options, but gig workers are mainly gravitating towards rideshare driving, delivering groceries, and renting out living and storage space.
2 in 3 Americans with some version of side work earn up to $500 per month
Most Americans aren’t getting rich off their side gigs (and other versions of supplemental work). But they are generating enough monthly income to help buffer against the cost of inflation, which, according to some estimates, inflation tacks on an extra $341 in expenses to U.S. households every month.
Using Pollfish.com, we surveyed 1,003 American adults on October 30, 2022. Respondents had to be 18 years or older to participate. Survey respondents were all based in the U.S.
Respondents were 44% male and 56% female. Their ages were:
- 18-24: 16.35% of respondents
- 25-34: 21.73% of respondents
- 35-44: 29.41% of respondents
- 45-54: 18.84% of respondents
- Over 54: 13.66% of respondents
Inflation is a scrooge this year. But Americans are scrappy and find creative ways to make money, from storing their neighbor’s belongings in their extra space to delivering groceries. When gifts and travel are this expensive, ’tis the season for the holiday hustle.
The post 78% of Americans Are Cutting Back On Holiday Spending This Year appeared first on Neighbor Blog.